State treasurers have little notoriety on Main St., but are heard on Wall St. and Pennsylvania Ave.

OKLAHOMA CITY -- Treasurer Claudette Henry had been in office barely five weeks when Oklahoma lawmakers proposed legislation that would tell the state's new fiscal officer how to handle $1.5 billion in investments.

It's not that she had done anything wrong. Instead, the proposal -- later weakened and passed -- was the legacy of Ellis Edwards, her controversial predecessor.

Many believe Mr. Edwards was assured a second term until audits that alleged kickbacks involving his former top investment officer and accusations that $567 million of state funds were illegally invested in reverse repurchase agreements -- illegal under the state constitution -- made headlines.

Even though Mr. Edwards had turned an obscure office into a high-profile, attention-getting one, voters had heard enough to deny him a second term. Lawmakers had seen enough to believe the treasurer needed help. The result: an advisory board that will consult with Ms. Henry.

"One of these days, we're going to drop off the front page and be back in the business section, not in the gossip columns," Ms. Henry lamented earlier this year.

The lesson in Oklahoma and elsewhere is that bad news can mean the worst kind o fpublicity for an obscure and often misunderstood office.

"Finances are usually a snoozer," said Milton Wells, executive director of the National Association of State Treasurers. "The public only takes an interest when things go wrong.

"It hurst them and helps them," he said. "If you asked the common man on the street what the state treasurer does, he would probably say that they go into the vault and play with the state's money."

'Visible Enough to Move On'

In fact, the nation's treasurers invest tens of billions of dollars of public money everyday, generating millions of dollars in revenues that spare the need for higher taxes or fees to run state government.

Despite the importance of that job, the state treasury usually attracts number-crunchers, empire builders content with the job, or political climbers on their way up. That was the case for former treasurers in Colorado, Kansas, and Texas who are now governors. A half dozen others recently moved to other positions in state government, though no state treasurer has ever become President.

"I think it's definitely one of the key offices that is visible enough to move on to something else," said the freshman Texas treasurer, Kay Bailey Hutchison, who quickly added, "I'm not saying I'm going to do that."

Even if she wanted to, Ms. Hutchison, who is one of 17 new state treasurers elected last fall, is already finding that attracting the kind of good publicity that builds goodwill with voters is difficult. Earlier this year, when she announced a widely endorsed debt management plan for Texas, it attracted sparse coverage in the state's media -- even on a slow news day.

Even though her office invests some $1 billion in state monies and collects $500 million a year in tobacco taxes, the average Texan might be hard pressed to recall who the treasurer is.

"I don't know that I can say the average Texas sits around drinking beer and thinking, 'Gee, Kay Hutchison is making money so there won't be a need for new taxes," she said.

Like Ms. Hutchison, other state treasurers say they do not spend much time worrying about the lack of recognition that can go with the job.

"My job is saving them a million here and million there and making a few million here from investments," said Kathleen Brown, California's treasurer. "Power is one thing, but performance is another -- and I'm into performance."

While many treasurers are given only a few duties, Mr. Brown has inherited an office that includes seats on nearly 50 boards involved in many state functions -- a fact that many say makes her office the most powerful treasury in the nation.

In Florida, Treasurer Tom Gallagher may not have the same influence as his counterpart on the West Coast, but he does have plenty to do. In fact, his office publishes an 11-page guide to his duties, which include investing $5 billion in state funds as treasurer, acting as insurance commissioner, and being the state's fire marshal.

"I have to read it once in a while to remind me of what I do," Mr. Gallagher joked. "They don't give me three salaries to go with each job."

But those duties have put 1,200 state employees under his direction. In other states, the treasury employs considerably fewer.

Raids on the Office's Power

Stan Smith, Wyoming's treasurer, now has 11 employees, but he had six times that before the Legislature stripped his office of the power to run the state's worker's compensation insurance fund. Although his office did not lose the program because it was mismanaged, Mr. Smith said no treasury is immune from attempts to raid its powers, as was attempted four years ago in neighboring North Dakota.

"It usually is spurred by a small minority of legislators with an axe to grind," said Mr. Smith, who is president of the National Association of State Treasurers. "For the most part, they have not been successful."

Of course, payroll size and duties are not always the key to power or using the treasury as a springboard to higher office.

"Personality has a lot to do with it," said Mr. Wells, who cited Texas Gov. Ann Richards as an example.

The first woman to head the treasury, Ms. Richards was already well known in Texas. Some believe her candidacy for governor was solidified at the 1988 Democratic National Convention, when she gave a Texas-style barbing to then-presidential candidate George Bush.

For Patric Quinn, freshman treasurer of Illinois, his career as an activist began in the 1970s, when he championed a statewide referendum that cut the size of the state Generally Assembly -- leaving one-third of the legislature without jobs.

Later, he critized legislative pay raises and promoted a pro-consumer platform that brought him notoriety and the label of political maverick. But this spring, Mr. Quinn went back to the legislature he helped shrink a decade ago and passed bills creating an education savings account for Illinois families.

"I'm sure that some members still harbor bad thoughts about that," he said. "But I get along okay with the legislature."

While many believe Mr. Quinn wil use the office to run for a higher position -- like governor -- he says otherwise. "I had a long, hard battle to get to the state treasury, and I'm not interested in waving a flag for another office," he said.

Of course, how influential a treasury is depends on how the treasurer is chosen. In most states, it is by popular vote, but in four states -- Michigan, New Jersey, New York, and Virginia -- the job is filled by gubernatorial appointment, making the job essentially a cabinet-level position.

But in states like Georgia, Maine, Maryland, and New Hampshire, the treasurer is appointed by the legislature. Because he answers to elected lawmakers, Maine Treasurer Samuel Shapiro has not spent many of his 11 years worrying about his own agenda.

"I go around saying that maybe two or three percent of the people know who the treasurer of Maine is, but that's only because I've got a big ego," he laughs, adding, "All the bank president know who I am."

Even if notoriety at home is lacking, outside the state capital of Augusta, Mr. Shapiro and his counter-parts in other states are finding they now have a louder voice with policymakers in Washington and analysts on Wall Street.

"I think the role of the treasurer has changed," he said. "Nobody cared about what we thought. Now they want to hear what we think."

He may be right. Mr. Shapiro and other treasurers got a strong reception on Capitol Hill this summer, when they gave testimony concerning the extension of mortgage revenue bond programs and similar provisions.

And when treasurers from New England states became concerned that rating agencies were treating all their states the same because of the recession in the Northeast, they aired their concerns in unprecedented group meeting with Wall Street analysts.

"Five years ago, we could never have done that," he said, noting that things are changing. "You have to be smarter to be treasurer today. Used to be, you could sit there and add things up on slips of paper, but not any more."